- US and European equities tumbled lower this morning as traders reacted to various reactions to this morning's key PCE and personal spending data. Fed speakers and analysts were out discussing the data and clearly markets do not like what they're hearing. As of writing, the 10-year yield on the UST has come in four bps to 2.516%, the DJIA is down 0.41%, the S&P500 is down 0.55% and the Nasdaq is down 0.37%.

- The May core PCE number, the Fed's preferred measure of inflation, grew 1.5%, right in line with consensus expectations. Analysts and the Fed should be quite satisfied with the measure, which shows healthy but not excessive inflation growth. The May personal spending data was poor, coming in at a mere +0.2%, thanks to weakness in the services component. Note that the softness in the index may stem from a big drop in real services consumption, reflecting the more rapid reversal of high winter-time utility utilization.

- Following the weak personal spending numbers, two firms have trimmed their expectations for Q2 US GDP growth. Barclays adjusted its call to +2.9% from +4% in its prior view, to reflect a more modest rebound in Q2 consumption growth. TD Ameritrade cut its Q2 GDP view to +3.0% from +3.6% prior. TD said that while there is plenty of scope for upside surprise on the inventory build and exports, the risks tilt lower rather than higher.

- Two FOMC non-voters spoke this morning in the wake of the PCE data. Dove Bullard said the US economy actually looks pretty good and many people were not yet mentally prepared to see the improvements. According to Bullard, the economy should be able to handle moves to pull in monetary policy. Hawk Lacker said recent inflation data was not just noise and that inflation measures would head higher this year, while Bullard said PCE inflation would only be moving above 2% in 2015. Lacker warned it would be a mistake to allow inflation to get out of control before the Fed started raising rates.

- The BoE announced plans to crack down on unaffordable mortgages, ruling that no more than 15% of banks' lending can over than 4.5x income. UK housing stocks rallied and GBP/USD approached 1.7050 as measures were seen as broadly in line with market expectations and would not inhibit lending.

- US-traded ADRs of Barclays are down 7% this morning after New York AG Schneiderman leveled fraud charges at the bank. Barclays is accused of favoring high-frequency traders in dark pool trading even as it said publically it was doing the opposite and falsifying documents showing how much high-frequency traders were buying and selling.

- In earnings news this morning, shares of homebuilder Lennar are mostly unchanged despite a very good second quarter report. The firm beat expectations on solid growth, with new orders +8% y/y, home prices +14% y/y and backlog +11% y/y. After rising around 2% in the premarket, share of ConAgra are back to unchanged after a mixed earnings report. Accenture cut its FY14 guidance despite solid, expectation-beating growth in its third quarter and solid bookings. Shares of ACN dropped as much as 3.5% before recovering slightly.